NORWAY – Orkla, through its subsidiary Orkla Foods Sverige has signed an agreement to acquire the Danish bakery Struer Brod A/S for an unknown sum to enhance production capacity.
Orkla Foods will assume the business operations of Struer which has been supplying Orkla with breakfast cereals and breadcrumbs.
According to the company, the acquisition of Struer aims to expand its production capacity for breakfast cereals given successful launch of the products in various markets.
The breakfast cereals business in Norway is gaining momentum in the market following a shift toward organic breakfast cereals- according to Global Breakfast Cereals Market 2017-2021 report.
The company was seeing good growth in the category due changing consumer tastes and preferences for natural and organic breakfast cereals.
Orkla has been one of Struer’s customers since 2016 and has contributed greatly on the company’s revenue sales which recorded US$19 million.
“Struer delivers high-quality products and has strong product development expertise.
We are pleased with our collaboration with Struer, and this acquisition is strategically important to ensure sufficient production capacity and product development for the future,” said Atle Vidar Nagel Johansen, Orkla EVP and CEO of Orkla Foods.
Orkla offers a broad selection of healthier breakfast products through a selection of its brands Paulúns, Bare Bra and Det Gode Liv brands.
The company’s acquisitions are driven by the motivation to offer branded consumer goods and concept solutions to the grocery, out-of-home and bakery markets in the Nordics, Baltics and selected markets in Central Europe and India.
Owned by Lantmännen Cerelia A/S, Givesco A/S and JN-Holding; Orkla’s subsidiaries including Orkla Foods, Orkla Confectionery and Snacks, target to offer customers with healthy and environmentally friendly products.
Orkla considered venturing into frozen vegetable business in 2017 when it acquired Agrimex to strengthen the brand position.
Expanding its portfolio in the frozen vegetable and breakfast categories marks the company’s bid to strengthen their position in out-of-home sector.